Wednesday, August 6, 2008

Sensex EPS Growth 0%?

When I posted on July 10, Sensex earnings was 807.78. Yesterday on 5th August at 14961.07, Sensex P/E is at 18.54 . Thus EPS turns out to be 806.96 less than what it was on July 10, i.e. June quarter results have lowered Sensex EPS instead of increasing it. The reason may be due to lower reported earnings by ICICI Bank, State Bank of India, ITC, ACC, Jaiprakash Associates, Mahindra & Mahindra, Maruti Suzuki, NTPC, Ranbaxy and Tata Motors. The pain has increased due to significant equity dilution by HDFC, HDFC Bank, Hindalco, ICICI Bank, Jaiprakash Associates, Reliance Infrastructure, State Bank of India and Tata Steel. As of 5 August 2008, these companies account for around 40% weightage in Sensex. The methodology of BSE site may be wrong.
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